Is Etrade brokerage and IRA (ROTH, Traditional) account free of charge to open and use? Is stock trading on Etrade Pro free to all clients?

Is Etrade Free To Use?

The answer to the question "Is Etrade Account Free?" is Yes and No. "Yes" - it costs nothing to open and have an account at Etrade - there are no annual account fees as well as no setup, maintenance or inactivity charges. And "No" - if you wish to buy or sell a stock, ETF, or mutual fund there are usually broker commissions to pay (with some exceptions).

To open a non-retirement account at Etrade you need just $500 which you could withdraw after a week. For a retirement account there is no initial deposit requirement.

Etrade charges $6.95 fee for selling and buying any stock or ETF. Clients making 30 or more trades per quarter are getting a $2 per trade discount. Unlike some other online brokers, there is no surcharge to trade penny stocks or large amount of shares. However, the broker has a surcharge of $0.005 per share on extended hours trades (ECN fee) as well as trades executed through Etrade Pro at an ECN.

As you see, Etrade is not free to trade. If you want a broker who is really free (has no commissions) check out Firstrade Review.


Is Etrade Pro Free?

Etrade Pro is the flagship web-based trading platform offered by Etrade. It's a software that active traders, day-traders and professional investors use. Only customers who execute 30 or more trades per quarter or have $250K account balance get it at no charge. Otherwise Etrade Pro costs $99 per month (in sharp contrast to TD Ameritrade's Thinkorswim platform which is available to all clients free of charge).


All Etrade Trading Fees

ProductPrice
Stocks and ETFs $6.95 or $4.95*
Options $6.95 + $0.65 per contract or $4.95 + $0.50*
Mutual funds $19.95
Bonds $1 per bond with $10 minimum, $250 maximum
Futures $1.50 per contract, per side + fees
Certificates of Deposit (CDs) $24.95

* - $4.95 per equity trade and 50 cents per options contract for users who make 30 or more trades in the prior calendar quarter.



Cost to Open an Etrade Account

So you are thinking about opening an Etrade account and you want to know what the costs are, both the obvious and the fees that are somewhat hidden. This article will go over what you can expect when opening an Etrade account.


Account Opening, Maintenance, and Transfer Fees

Opening an account with Etrade is completely free, however you must deposit a minimum of $500 within 60 days of account opening or they will deactivate it. That said, after you make this deposit there is no regular maintenance or inactivity fee regardless of how much or little you trade. Etrade also charges outgoing account transfer fees that are comparable to those charged by TD Ameritrade and others ($25 for partials and $75 for full transfers).


Etrade’s Personalized Investment Services

Etrade also offers some tiered advisory services where you can pay them to manage your portfolio for you based on your financial goals and risk appetite. This is similar to, but perhaps more comprehensive than, the advisory service offered through TD Ameritrade, called Essential Portfolios. There are three levels to Etrade’s advisory service based on how much customization you want: Core Portfolios, Blend Portfolios, and Dedicated Portfolios.


Core Portfolios

This is the most basic option to choose from, where Etrade will ask you some questions about your financial condition, goals, and risk appetite to build and manage for you a tailored portfolio of ETFs. They will monitor and rebalance the portfolio as needed so you don’t have to. This first tier requires an account balance of at least $5,000 and charges a 0.30% annual advisory fee (the first year is currently waived).


Blend Portfolios

Blended portfolios is the second level of personalized portfolio services, and although it’s similar to the first tier it is more personal. You are assigned a financial advisor at Etrade who will work with you one on one to determine your optimal portfolio, taking more detail into consideration (i.e. your tax situation) and using a broader variety of investment tools, such as ETFs and mutual funds where applicable. This service has a $25,000 minimum requirement and an advisory fee between 0.65% and 0.90% depending on your portfolio size.


Dedicated Portfolios

The highest tier of Etrade’s investment advisory service offers you the same connection to a financial advisor as the second tier, but it offers you the ability to further customize your portfolio down to the very last detail, to each individual stock. For example, you might want your portfolio to avoid investments in tobacco or firearms manufacturers (so-called “sin stocks”). This premium level of service requires at least $150,000 and comes with an annual advisory fee between 0.95% and 1.25%.


Fees on Etrade’s Retirement Accounts

Like most brokers, Etrade also offers a variety of retirement accounts, including Traditional and Roth IRAs. Their retirement accounts are just like their taxable ones in that they are also free from account opening, maintenance, and inactivity fees.


Etrade New Account Promotions

Besides the fact that it’s free to open an Etrade account, they have a sweet promotion going on at the moment. If you open a new account and deposit at least $10,000 within 60 days you will get up to 500 commission-free trades (for stocks or options) to be used within 60 days of your first deposit. Additionally, you can receive between $200-$2,500 cash if you deposit between $25,000 to $1,000,000.


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